Should You Skype?

It works like this: You download the free Skype client software onto your PC, Mac or Linux-based computer and create an account. If you already have a headset or microphone and speakers attached to your computer, you're done.

The benefits:

• Regular domestic and international calls.

  Calls to Skype users are free, and there are 7 million of them. Calls to non-Skype users average about 2 cents a minute to anywhere in North America and most of western Europe. You can also purchase a calling plan allowing unlimited calls to non-Skype users in the U.S. and Canada for $30 a year.

  The closest competitor, Vonage (VG Quote), offers similar free or low-cost VOIP service, but it has monthly and initial setup charges. Think of Skype is the "pay as you go" version.

• International calls while traveling.

  Here's a Skype killer app. You're traveling in Europe and you need to check in with the home office and family for a few hours each night. A typical business cell plan might charge 67 cents a minute -- that's several hundred dollars over the course of a two-week trip. With Skype, the cost would be zero to other Skype users, or 2 cents a minute otherwise. Even Vonage costs $30 a month with a required 12-month-plan signup.

• International inbound calls.

  Suppose you have a lot of international family, friends or clients and you want them to call you cheaply. Skype offers a service called SkypeIn, whereby you lease (for $38 a year) a standard public phone number from Skype. You can set your number to be in any local area code in any of 14 different countries.

  So if you have a lot of customers in, say, Sao Paolo, you can lease a SkypeIn number in their local area code, and they can then call you without incurring long-distance charges. You can have as many as ten active SkypeIn numbers per Skype account.

Now, if the idea of making phone calls from your PC sounds a bit inconvenient -- and it does to me -- there are solutions. You can buy a Wi-Fi phone from companies such as Linksys, Netgear or Belkin that come preloaded with Skype software.

These Wi-Fi phones look and act like standard cell phones, and they work as long as you're in an active Wi-Fi hotspot. Apple's (AAPL Quote) iPhone will support Skype as well. Some hybrid cell/Wi-Fi phones allow you to transition from cell service to Wi-Fi and back to cell without interrupting a call, but these are still a bit expensive.

There are still some limitations to using Skype.

First, you must have Internet access where and when you use Skype (Wi-Fi is OK). Second the "free," wholly-Internet based call requires both users to have Skype and to have their computers turned on. Finally, to receive calls on Skype, you have to purchase a special phone number.

But I do expect the integration of Skype with ordinary cell-phone services to grow. As with other new digital technologies, there are still a few kinks, but I believe this is where things are going.

If you make a lot of calls -- especially international -- and if you travel overseas a lot, the Skype solution is definitely worth a try.